National General On January 4, 2021, the Company completed the acquisition of National General Holdings Corp. (“National General”), an insurance holding company serving customers predominantly through independent agents for property and casualty and accident and health products.

National General provides personal and commercial automobile, homeowners, umbrella, recreational vehicle, motorcycle, lender-placed auto and property, health and other niche insurance products. This acquisition increased the Company’s market share in personal property-liability and enhanced its independent agent distribution platform.


Assets and liabilities recognized in the National General acquisition (1)
($ in millions)	January 4, 2021
Assets
Investments	$	4,962
Cash	400
Premiums and other receivables, net	1,539
Deferred acquisition costs (value of business acquired)	317
Reinsurance recoverables, net	1,212
Intangible assets	1,199
Other assets	734
Goodwill (2)	1,038
Total assets	11,401

Liabilities
Reserve for property and casualty insurance claims and claims expense	2,765
Reserve for future policy benefits	186
Unearned premiums	2,245
Reinsurance payable	363
Debt (3)	593
Deferred tax liabilities	162
Other liabilities	776
Total liabilities	$	7,090

(1)The amounts reflect allocation of assets acquired and liabilities assumed.

(2)$675 million, $20 million and $343 million of goodwill were allocated to the Allstate Protection, Protection Services and Allstate Health and Benefits segments, respectively, and is non-deductible for income tax purposes. Goodwill is primarily attributable to expected synergies and future growth opportunities.

(3)Subsequent to the acquisition, the Company repaid $100 million of 7.625% Subordinated Notes and $72 million of Subordinated Debentures on February 3, 2021 and March 15, 2021, respectively. As of December 31, 2022, the Company had principal balance remaining of $350 million 6.750% Senior Notes due 2024, with a fair value adjustment of $26 million.

Intangible assets (reported in other assets in the Consolidated Statements of Financial Position) consist of capitalized costs, primarily of the estimated fair value of distribution and customer relationships, trade names, licenses and technology assets.


Intangible assets by type
($ in millions)	January 4, 2021
Distribution and customer relationships	$	795
Trade names	102
Licenses	97
Technology	205
Total	$	1,199

Value of business acquired (reported in DAC in the Consolidated Statements of Financial Position) recognized in connection with the acquisition of National General represents the value of future profits expected to be earned over the lives of the contracts acquired determined using a weighted-average cost of capital discount and other relevant assumptions. These costs are amortized over the policy term of the contracts in force at the acquisition date, generally over six or twelve months. The value of business acquired asset recognized in connection with the National General acquisition totaled $317 million, all of which was expensed in 2021. The most significant portion relates to insurance contracts in the Allstate Protection segment.

Other fair value adjustments included an increase in reserves of $62 million, a $9 million reduction to investments that were not held at fair value, and a net increase in current and deferred tax liabilities of $153 million.

Transactions costs (reported in operating costs and expenses in the Consolidated Statements of Operations) of $22 million related to the acquisition were expensed as incurred in the Corporate and Other segment.

SafeAuto On October 1, 2021, the Company completed the acquisition of Safe Auto Insurance Group, Inc. (“SafeAuto”), a non-standard auto insurance carrier focused on providing state-minimum private-passenger auto insurance direct to consumers with coverage options in 28 states, for $267 million in cash. Starting in the fourth quarter of 2021, the Allstate Protection segment includes SafeAuto.

In connection with the acquisition, the Company recorded goodwill of $79 million, intangible assets of $31 million and value of business acquired of $7 million. The intangible assets include $25 million and $6 million related to acquired customer relationships and licenses, respectively.

On December 17, 2021, subsequent to the acquisition, the Company redeemed the outstanding principal of SafeAuto’s trust preferred securities for $13 million.

Dispositions

Life and annuity business On October 1, 2021, the Company closed the sale of Allstate Life Insurance Company of New York (“ALNY”) to Wilton Reassurance Company for $400 million. On November 1, 2021, the Company closed the sale of Allstate Life Insurance Company (“ALIC”) and certain affiliates to entities managed by Blackstone for total proceeds of $4 billion, including a pre-close dividend of $1.25 billion paid by ALIC.

In connection with the sale of ALIC and certain affiliates, the sale agreement includes a provision related to contingent consideration that may be earned over a ten-year period with the first potential payment date commencing on January 1, 2026 and a final potential payment date of January 1, 2035. The contingent consideration is determined annually based on the average ten-year Treasury rate over the preceding three-year period compared to a designated

rate. The contingent consideration meets the definition of a derivative and is accounted for on a fair value basis with periodic changes in fair value reflected in earnings. See Note 7 for further details.

In 2021, the loss on disposition was $4.09 billion, after-tax, and reflects purchase price adjustments associated with certain pre-close transactions specified in the stock purchase agreements, changes in statutory capital and surplus prior to the closing date and the closing date equity of the sold entities determined under GAAP, excluding AOCI derecognized related to the dispositions.

Beginning in the first quarter of 2021, the assets and liabilities of the business were reclassified as held for sale and results are presented as discontinued operations. This change was applied on a retrospective basis.


Financial results from discontinued operations
	For the years ended December 31,
($ in millions)		2021		2020
Revenues
Life premiums and contract charges		$	1,109	$	1,350
Net investment income		1,336		1,262
Net gains (losses) on investments and derivatives		195		269
Total revenues		2,640		2,881

Costs and expenses
Life contract benefits		1,315		1,726
Interest credited to contractholder funds		414		605
Amortization of DAC		87		153
Operating costs and expenses		163		238
Restructuring and related charges		31		7
Total costs and expenses		2,010		2,729

Amortization of deferred gain on reinsurance		4		4

Income from discontinued operations before income tax expense		634		156

Income tax expense		136		9

Income from discontinued operations, net of tax		498		147

Loss on disposition of operations		(4,315)		—
Income tax benefit		(224)		—
Loss on disposition of operations, net of tax		(4,091)		—

(Loss) income from discontinued operations, net of tax		$	(3,593)	$	147


Major classes of assets and liabilities disposed in transactions
($ in millions)	Closing (1)
Assets
Investments
Fixed income securities, at fair value	$	26,425
Equity securities, at fair value	11
Mortgage loans, net	2,662
Limited partnership interests	1,624
Short-term, at fair value	643
Other investments, net	690
Total investments	$	32,055
Cash	1,081
Deferred policy acquisitions costs	996
Reinsurance recoverables, net	1,979
Accrued investment income	240
Other assets	536
Separate accounts	3,465
Total assets	$	40,352

Liabilities
Reserve for future policy benefits	$	11,573
Contractholder funds	15,880
Deferred income taxes	834
Other liabilities and accrued expenses	452
Separate accounts	3,465
Total liabilities	$	32,204

(1)The Company closed the sales of Allstate Life Insurance Company of New York and Allstate Life Insurance Company and certain affiliates on October 1, 2021 and November 1, 2021, respectively.


Cash flows from discontinued operations
	For the years ended December 31,
($ in millions)		2021		2020
Net cash provided by operating activities from discontinued operations		$	634	$	311
Net cash provided by investing activities from discontinued operations		984		330